- Joined
- 28 December 2013
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New Trading Idea
With all trading ideas, we are trying to tilt the odds of success in our favour by buying into trends whilst minimizing our losses. Buying good companies at the "right time" & getting off quickly "at the right time" when it all goes wrong is the simplicity of the system.
"The Ducati Daily Blue Bar strategy"
This strategy simply buys the first "blue bar" & sells the first "red bar" it simple & surprisingly effective. I've used @peter2 idea of colour coding the trend with "Blue Bars" so it's simple to follow along by looking at the charts. The "Blue" bars meets Duc's two conditions & the "Red" bars are when Duc's conditions "are not met". I've profited from Duc's advice where others might not have realised the opportunity that was posted. "The Ducati Daily Blue Bar Strategy" is clear to understand. The first "blue bar" is the signal bar (the white arrow) & we buy on the "next blue bar" at the open (the white square). The position is held till the first "red bar" & sell that position on the open on the next "red bar".
Making easy money
Trading the "Blue" bars & selling on the "Red" bar is a recipe for success.
Using a modified (RSI)
Let's turn or focus onto "Skate's modified RSI" indicator & explain how it works in relation to the "HappyCat Strategy"
The "HappyCat Strategy" is a pure Momentum Strategy
Momentum shifts the share price, "that's a given". Our decisions when to enter & when to exit a move really determines if we are to be profitable in the long run. I've calculated the momentum over a period from bar to bar as the entry signal. The exit signal is the reverse of the entry condition.
Momentum is either on or off ("Skate's modified RSI" indicator is green or red)
Momentum trading is simply trading the trend using the "momentum effect". The strategy works on the principle that momentum is either on or it's off there is no middle ground. Additional setting & parameters assist in the fine-tuning. The secret of momentum trading is the ability to filter out the false signals. The standard (RSI) indicator identifies potentially overbought & oversold levels that may reverse direction. However, the default lookback period of (14/15) doesn't work well. "Skate's modified RSI" is the stock standard (RSI) with a modified lookback period, nothing elaborate at all. The colour coding of the modified indicator identifies when the momentum is on & off. We buy when it's on & use the "off" period as a layer of our exit strategy.
Looking at the standard (RSI) line
The standard RSI is (the bottom line) that I found unhelpful as far as I'm concerned. The sensitivity of signals are found wanting using the (14/15) lookback period.
Skate.
With all trading ideas, we are trying to tilt the odds of success in our favour by buying into trends whilst minimizing our losses. Buying good companies at the "right time" & getting off quickly "at the right time" when it all goes wrong is the simplicity of the system.
"The Ducati Daily Blue Bar strategy"
This strategy simply buys the first "blue bar" & sells the first "red bar" it simple & surprisingly effective. I've used @peter2 idea of colour coding the trend with "Blue Bars" so it's simple to follow along by looking at the charts. The "Blue" bars meets Duc's two conditions & the "Red" bars are when Duc's conditions "are not met". I've profited from Duc's advice where others might not have realised the opportunity that was posted. "The Ducati Daily Blue Bar Strategy" is clear to understand. The first "blue bar" is the signal bar (the white arrow) & we buy on the "next blue bar" at the open (the white square). The position is held till the first "red bar" & sell that position on the open on the next "red bar".
Making easy money
Trading the "Blue" bars & selling on the "Red" bar is a recipe for success.
Using a modified (RSI)
Let's turn or focus onto "Skate's modified RSI" indicator & explain how it works in relation to the "HappyCat Strategy"
The "HappyCat Strategy" is a pure Momentum Strategy
Momentum shifts the share price, "that's a given". Our decisions when to enter & when to exit a move really determines if we are to be profitable in the long run. I've calculated the momentum over a period from bar to bar as the entry signal. The exit signal is the reverse of the entry condition.
Momentum is either on or off ("Skate's modified RSI" indicator is green or red)
Momentum trading is simply trading the trend using the "momentum effect". The strategy works on the principle that momentum is either on or it's off there is no middle ground. Additional setting & parameters assist in the fine-tuning. The secret of momentum trading is the ability to filter out the false signals. The standard (RSI) indicator identifies potentially overbought & oversold levels that may reverse direction. However, the default lookback period of (14/15) doesn't work well. "Skate's modified RSI" is the stock standard (RSI) with a modified lookback period, nothing elaborate at all. The colour coding of the modified indicator identifies when the momentum is on & off. We buy when it's on & use the "off" period as a layer of our exit strategy.
Looking at the standard (RSI) line
The standard RSI is (the bottom line) that I found unhelpful as far as I'm concerned. The sensitivity of signals are found wanting using the (14/15) lookback period.
Skate.